Rubicon Project and Telaria merger to create 'world's largest independent SSP'

Combined company will aim to create 'powerful, strategic alternative to the walled gardens'.

Rubicon and Telaria: established in 2007 and 2017 respectively
Rubicon and Telaria: established in 2007 and 2017 respectively

Rubicon Project and Telaria are to merge to form what they claim will be the "world’s largest independent sell-side advertising platform".

The two adtech vendors have entered into a definitive agreement to combine in a stock-for-stock merger – a transaction that has been unanimously approved by the boards of both companies.

On closing the agreement, Rubicon president and chief executive Michael Barrett will become chief executive of the combined company, while Telaria chief executive Mark Zagorski will be named president and chief operating officer. Rubicon chief financial officer David Day will take the same role at the merged company. Telaria board member Paul Caine will be chair of the new company's board, which will consist of nine members in total.

The combined business will create a "powerful, strategic alternative to the walled gardens", Zagorski commented, "which have been frustrating both buyers and sellers due to their lack of transparency, innovation bottlenecks and conflicted business models".

He added: "The two companies will provide more technology resources, a broader geographic footprint and deeper financial assets to attack the growing opportunity created by the shift from linear viewing to CTV [connected TV] to the benefit of our customers and in support of a thriving open internet."

New York-based Telaria was formed in 2017 as a rebrand of Tremor Video, after the latter sold its demand-side business in 2015. The supply-side platform is a connected TV specialist, powering Hulu's private marketplace. Los Angeles-based Rubicon was founded in 2007 and operates one of the world's largest ad exchanges.

The merged company will offer a single platform for transacting CTV, desktop display, video, audio and mobile inventory across all geographies and auction types.

Telaria and Rubicon’s combined revenue in the year to 30 September grew 32% to $217m and will have around $150m in cash and no debt, the companies said. Rubicon’s market capitalisation was at about $383m before the market opened on Thursday (19 December), when the deal was announced, while Telaria’s was about $350m.

The combined company will have more than 600 employees and 11 offices across the Americas, EMEA and Asia-Pacific.

Barrett said: "This transformative combination builds on our commitment to trust and transparency, and accelerates our strategy to provide buyers and sellers with a single path to every format and channel including CTV. We could not be more excited about the future as two individually strong industry leaders with complementary assets and cultures come together to create a market leader that we believe will generate significant opportunities for our employees, customers, partners and stockholders worldwide."

The transaction is expected to close in the first half of 2020, but is subject to regulatory approvals and other customary closing conditions, as well as approval from stockholders of both companies.

Telaria stockholders are expected to own approximately 47.1% and Rubicon stockholders around 52.9% of fully diluted shares of the merged company. 

A version of this story first appeared on Campaign Asia-Pacific